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Basic Project Risk Management

This document serves as an introductory guide to project risk management, outlining the definition of project risks, methods for identification, assessment of probability and impact, response strategies, and the importance of maintaining a risk register. It emphasizes the continuous nature of risk management and the necessity of regular review meetings to address and adapt to changing project conditions. Practical actions are suggested, including assigning ownership and due dates to high-priority risks.

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Lian Lyon
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2 views3 pages

Basic Project Risk Management

This document serves as an introductory guide to project risk management, outlining the definition of project risks, methods for identification, assessment of probability and impact, response strategies, and the importance of maintaining a risk register. It emphasizes the continuous nature of risk management and the necessity of regular review meetings to address and adapt to changing project conditions. Practical actions are suggested, including assigning ownership and due dates to high-priority risks.

Uploaded by

Lian Lyon
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Basic Project Risk Management

An introductory guide to identifying, assessing, and controlling project risks.

Contents
1. What is a project risk?

2. Risk identification

3. Probability and impact

4. Response strategies

5. The risk register

6. Review meetings

Original educational document Page 1


1. What is a project risk?
A risk is an uncertain event or condition that may affect cost, time, quality, safety, scope, or
reputation. Risks can be negative threats or positive opportunities.

Risk management is not a one-time exercise. It is a continuous process of identifying uncertainty,


assigning ownership, taking action, and reviewing changes.

2. Risk identification
Review the scope, assumptions, interfaces, schedule, procurement plan, site conditions, resources,
approvals, and contractual obligations. Ask what could prevent each key activity from succeeding.

Useful sources include lessons learned, team workshops, specialist reviews, client feedback, and
historical project data. Describe risks as cause-event-impact statements.

Practical action

Add one owner and one due date to every high-priority risk.

3. Probability and impact


Rate probability and impact using a consistent scale, such as 1 to 5. Multiplying the two gives a
simple risk score. High scores require immediate management attention, while low scores may be
monitored.

Impact should be considered across several dimensions. A risk with moderate cost impact may still
be critical if it affects safety or statutory approval.

4. Response strategies
Avoid: change the plan to remove the threat. Reduce: lower probability or impact. Transfer: allocate
part of the exposure through insurance or subcontracting. Accept: acknowledge the risk and prepare
a contingency.

For opportunities, strategies include exploiting, enhancing, sharing, or accepting. Every response
should have an owner and a target date.

Practical action

Add one owner and one due date to every high-priority risk.

5. The risk register


A practical register contains the risk ID, description, cause, impact, probability, score, response,
owner, due date, current status, and residual score.

Keep the register focused. A long list with no ownership is less useful than a shorter list that is
actively reviewed and updated.

6. Review meetings

Original educational document Page 2


Review top risks regularly and whenever scope, design, schedule, or market conditions change.
Close risks that are no longer relevant and add new ones promptly.

The purpose of review is decision-making. Discuss changes in exposure, overdue actions, required
escalation, and contingency use.

Practical action

Add one owner and one due date to every high-priority risk.

Note: This document is for general educational purposes. Adapt the ideas to your own circumstances and professional
requirements.

Original educational document Page 3

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